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Generic marketing: A million dollar question?

30 december 2014

The World Diamond Mark Foundation’s generic marketing initiative, an attempt to bring all in the diamond pipeline to collaborate on marketing was a topic widely touched up by all at the World Diamond Conference in Delhi recently. However, each of the miners spelled out their own initiatives.

For instance, Stephen Lussier, CEO of De Beers Forevermark, was of the opinion that the industry should not rely on earlier methods of marketing diamonds. De Beers, he explained, after moving away from generic marketing of yesteryears has adopted a more realistic approach of ‘branding’ by creating a desire for the product which will benefit the company as well as its partners with its brand ‘Forevermark’. Lussier’s contention was that when De Beers repositioned its marketing program from generic to brand-focused, it does not mean that investment in marketing has decreased in any way. Along with De Beers, major jewelers too spend an enormous amount of money on the brand ‘Forvermark’ advertising, which, at the end of the day, helps in marketing of diamonds in general and therefore beneficial to the global industry on the whole.

While the generic marketing of diamonds with the famous "Diamonds-are-forever" tag is history and will not bring back the days gone by, Lussier’s insistence that branding is the future was well received. He revealed that statistics show that in 2002, only 7 per cent of the consumers had bought a branded diamond, while by 2014 more than 25 per cent of the buyers had purchased a branded diamond. So, according to Lussier, ‘branding works’; and “the global Industry as a whole has to spend more on ‘Marketing’. The global industry should come together and spend collectively to promote the diamonds among the consumers,” he said.

Jean Marc Lieberherr, MD of Rio Tinto Diamonds emphasized the success of the Rio Tinto’s branding campaign with the ‘Nazraana’ series. He stressed on collaborations from mine to retail as the only way to create value in the diamond industry. Rio Tinto ‘Nazraana’ is a "partnership" brand, which was marketed by Rio Tinto in alliance with local manufacturers and has achieved immense success, he reiterated.

Understandably, ALROSA seemed not too eager in the ‘ generic marketing’ discussions as unlike De Beers or Rio Tinto ALROSA is currently not into downstream activities like manufacturing diamonds, jewellery or even into retail. Being solely diamond producers or miners, at least for the present, it is legitimate if they do not actively participate in any generic marketing programmes, according to diamond industry analysts.

Meanwhile, Alex Popov, chairman of the World Diamond Mark Foundation is right when he fears that diamonds have fallen in ranking of the most desired luxury goods as leather goods, travel, and will soon be surpassed by electronic goods. Surely, given the current situation, many in the diamond pipeline may feel the best option is to participate in marketing initiatives such as Forevermark and the World Diamond Mark, to retain their margins. Popov also said that the WDM’s ‘Authorised Diamond Dealers programme’ would help create a strong basis for trustworthiness of the retail jeweler, and that he would like to make a push for a ‘generic marketing programme’ in which all stakeholders participated.

Ernest Blom, President of the WFDB, noted that a suggestion to create a diamond industry think-tank to discuss the ways to move forward the issue of generic diamond promotion has been adopted by the WDMF and the WFDB. According to him, “this initiative will help propel the development of the WDMF and contribute toward the inclusion of all stakeholders in the World Diamond Mark growth.

Blom pointed out that, as they can no longer rely on mining houses to do so, the Industry should take up the responsibility for developing a marketing plan for diamond jewellery.

Popov announced that the first think-tank meeting is scheduled for upcoming March and the next World Diamond Conference is slated for November 2015. "We would hope to emulate the excitement and quality of the inaugural event, and to make this an annual tradition,” he concluded.

WDMF’s initiative may help manufacturers and dealers to together work out a suitable marketing strategy with their retail partners, if the initial interest in the program is retained. Without any doubt, generic marketing is the need of the hour, but who will foot the bill? That’s a million dollar question!

Aruna Gaitonde, Editor in Chief of the Indian Bureau, Rough&Polished